Introduction to Top Stock Losers

Top losing stocks are companies whose stock prices have dropped significantly in a given period. These firms usually are meant for stock investors or day traders who might want to exit from previous positions, or look to buy a stock at significantly cheaper levels. Top stock losers are companies that have underperformed their counterparts.

Key Features of Top Stock Losers

A company’s stock can drop and be among the top losers if its financial performance has remained sub-par or it consistently fails to meet analyst expectations for its revenues and profits.

Negative news or any kind of negative publicity can push a stock to be among the top losers on a given day or for a particular time frame as investors generally sell off such shares.

Larger macro economic changes can also affect a particular sector and all the stocks within, pushing them among top losers. For instance, a jump in interest rates will push all technology shares lower, a drop in crude oil prices will negatively affect oil and gas stocks.

Details of Top Stock Losers

Some of the prominent stock losers in recent times have been Nykaa and Infosys.

Nykaa

Over the past one year the Nykaa share price has plunged almost 60%. The new age tech company has borne the brunt of the continuous rise in interest rates and a tough macroeconomic environment characterized by hardening inflation and slowing demand.

Infosys

One of the leading IT companies of India, Infosys’ share price has eased by more than 19% in the past one year. Banking crisis in the key market of the US along with a continuous rise in the interest rates have been some of the triggers which have led to Infosys share price correction in the past year.

How to Evaluate Top Stock Losers

Top stock losers, as the name suggests are stocks that are consistently falling and there are specific ways to identify if a stock is on the path to be a top losing stock.

• Weak Financials

  If the stock’s financials have been constantly underperforming industry standards, that means the business is not running at its optimum capacity due to multiple factors that might lead to the stock to drop further.

• Trends

  As mentioned above, industry trends are a critical factor to judge the future trajectory of stock movements. If an entire industry is in turmoil most of the stocks functioning in that industry will suffer.

• Management Issues

  A stock which has been on a downward trend in recent times has a high chance of facing issues regarding its management. Issues in the top management lead to reduction in efficiency and smooth functioning of the company which in turn adversely affects the share price.

Who Should Invest in Top Stock Losers

Top losing stock on face value might seem like a bad investment to make. However, for investors who have a high risk taking ability, it can be a great entry point to earn high returns in the future.